Holden boss Mike Devereux announced yesterday that the company will stop manufacturing cars in Australia by the end of 2017.
Nearly 3000 Holden workers will be directly affected by the closure of manufacturing operations in Australia while unions have suggested the decision would cost 50,000 jobs in the auto sector. Rival carmaker Toyota also warned that Holden’s decision would put pressure on its ability to manufacture cars in Australia.
When questioned on why Holden had made the decision, Mr Devereux said that the car industry in Australia is facing a combination of negative influences which included the high cost of production, the price of the Australian dollar and the size of the domestic market. “Building cars in this country is just not sustainable” said Mr Devereux.
The writing has been on the wall for the Australian car industry and manufacturing in general for the past decade, so Holden’s announcement yesterday came as no surprise to anyone. Unlike other struggling industries, such as print publishing, significant government handouts have propped up the car industry. With the new Coalition-led Federal Government making it very clear over, the past two weeks, that it had no intention of continuing the levels of hand-outs which were given by the previous government, Holden’s timeline to pull out of building its cars in Australia seems to have been brought forward to 2017.
The unions are painting this announcement as doomsday for the industry, with 50,000 workers expected to lose their jobs due to Holden’s withdrawal from Australia. In reality, even if these workers are made redundant and forced to find different jobs, there is a full three years before this stoppage occurs.
My first car I ever owned was a Holden and I’m certainly a little disappointed to think that future generations won’t have the opportunity to drive an Australian made version. I’m also a realist and understand that you have to know when to end a bad relationship, no matter the history. Starting as a saddlery business in 1856, Holden is a part of Australian history and even though its cars may be manufactured outside of Australia, I suspect the company will continue to have a strong future in the country.
What do you think? Will you ever consider buying a Holden or Ford which is manufactured outside of Australia? Do you sympathise with those 50,000 car-manufacturing workers who will need to find a new industry to work in? Should the Federal Government have done more to keep Holden manufacturing in Australia?